Online business

Online businesses are not places of public accommodation, says Ninth Circuit

Title III of the Americans with Disabilities Act (ADA) prohibits private entities from discriminating against people with disabilities. Specifically, it prohibits a “place of public accommodation” from discriminating “on the basis of disability” and requires businesses to make their facilities accessible for “full and equal enjoyment”.

Federal courts have long been divided on whether online-only businesses are “places of public accommodation” under the ADA. In the Ninth Circuit, online-only businesses are not liable for ADA violations because the Ninth Circuit does not consider an online-only forum to be a “place of public accommodation” within the meaning of the law. To circumvent adverse precedent in the Ninth Circuit, plaintiffs in California have filed thousands of lawsuits each year in state courts alleging standalone violations of state laws – such as the California Unruh Civil Rights Act (Unruh Act ) – which are parallel to the ADA. Until recently, California courts of appeals had not decided whether online-only businesses are “places of public accommodation” under Unruh. As a result, California state courts, which were not bound by Ninth Circuit precedent, were free to decide for themselves whether Congress intended an online-only forum to be a “place of public” under the ADA. The inevitable result was a baffling inconsistency at the state level – a superior court judge was just as likely to dismiss an Unruh Act case against an online-only company as another superior court judge was to decide that the ‘ADA applied to the website of a similar company. .

That all changed last month, when the California Court of Appeals, in Martinez vs. Cot’n Wash, Inc.joined the long-standing Ninth Circuit precedent in concluding that online-only businesses are not “public accommodations” covered by ADA Title III. Martinez vs. Cot’n Wash, Inc., 81 Cal. App. 5th 1026 (2022).

WHAT DOES THAT MEAN?

For California businesses operating exclusively online businesses (i.e., online commerce that is not connected to an actual physical building or facility), this ruling should limit the number of accessibility lawsuits. ADA registered in California under ADA and Unruh law.

In Martinez, the plaintiff alleged that the defendant violated the Unruh law by intentionally maintaining a retail website inaccessible to the visually impaired. The plaintiff, who was visually impaired and used screen reader technology to access the Internet and read website content, alleged that the defendant’s website did not support the plaintiff’s screen reader software. Plaintiff advised Respondent that its website was not fully accessible to the visually impaired, and Plaintiff alleged that Respondent failed to take adequate steps to correct these barriers, even after being informed of the discrimination caused by these barriers.

In California, a plaintiff can recover under the Unruh statute under two theories: (1) a violation of the ADA, or (2) a denial of entry to a commercial establishment based on intentional discrimination. The Martinez the court dismissed the plaintiff’s claim under both theories. On the first theory, the court reviewed the wording of Title III and the 2022 US Department of Justice guidelines (which are silent on regulations regarding website accessibility), and found that the phrase ” public accommodation” could not be interpreted as designating merchant sites that have no connection with a physical space. Under the second theory, the court found that a company’s failure to address the known discriminatory effects of an apparently neutral website is not sufficient, on its own, to establish intentional discrimination under the Unruh law.

WHAT HAPPENS NEXT?

The applicant in Martinez, with the support of “tester” attorneys and plaintiffs (who go from website to website for the sole purpose of filing lawsuits), will likely seek a review with the Supreme Court of California. Online-only businesses may also see pressure from the Complainants Bar to make more aggressive allegations of intentional conduct in an effort to meet the higher threshold now established under Martinez of intentional discrimination.

In the meantime, the Martinez The ruling should give California online-only businesses a break from these website accessibility lawsuits. If the California Supreme Court so affirms, it will be a watershed moment for online-only companies doing business in California.